Conferences explore TV options

Officials from the major
college conferences have stark choices in front of them as their TV rights
deals come due.

The mtn., launched by the Mountain West
Conference, has struggled to find distribution.

They can go for the easy
money and sell their rights to ESPN, which paid $200 million over the next six
years to carry Big East basketball and football games across all of its
platforms.

Or they can follow the Big
Ten’s lead by setting up their own TV channel, which, if successful, could be
worth much more than a rights fee could bring in. The Big Ten still is
collecting $100 million over 10 years from ESPN for its bigger football and
basketball games. But it set up a 20-year partnership with Fox to start the Big
Ten Network, with the conference holding a 51 percent stake.

It’s not an easy choice to
make. So far, the two conferences that are launching their own channels have
encountered distribution challenges. The Mountain West Conference, which
launched The mtn. last fall, does not yet have a deal with a satellite
operator. And the Big Ten Network, which still is five months from launching,
has yet to cut a deal with a cable company.

“Understanding the risk is
not something that can be shortsighted,” said Greg Shaheen, the NCAA’s senior
vice president for basketball and business strategies. “Our institutions are in
the business of educating young people. … They’re not generally in the business
of being in the broadcast business. So this is a shift in the paradigm and each
individual institution is going to have a unique comfort level that’s going to
have to be settled.”

Key conferences and their TV rights deals

ACC
Football
ESPN through 2011Basketball
Lincoln Financial/Raycom Sports through 2010-11

The Big 12 is the next
major conference that will be faced with this decision. It has been in an
exclusive negotiating window with ESPN for the past two weeks. Neither side was
talking about how long that window lasts, or the tenor of the negotiations so
far. But ESPN is trying to convince the Big 12 that it has the platforms and
distribution necessary to really grow the business.

“Our pitch to conferences
is that we are basically one-stop shopping,” said Chuck Gerber, ESPN’s
executive vice president of college sports. “We believe that maximizing
exposure on all those platforms of ESPN would fulfill all their needs.”

If those deals fail to gain
traction, Fox plans to tout its current relationship with the Big 12, which
includes exclusive cable rights to the conference’s football games.

“If the Big 12 wants to do
a widely distributed sports network, unless they work something out with us,
that channel is unlikely to have football,” said Bob Thompson, president of Fox
National Cable Sports Networks.

Obviously, Fox is looking
to launch channels similar to the Big Ten Network. However, it realizes that
the Big Ten’s strategy wouldn’t work for every conference. Some conferences may
have the same geographic size as the Big Ten, but only half the number of homes
in the territory. Other conferences may not be as popular as the Big Ten.

“Does Conference USA, does
the Missouri Valley Conference bring in the types of dollars that would be paid
to the Big Ten, the Big 12 or the ACC?” Thompson asked. “The answer’s no. I
don’t believe that it precludes someone from going in and figuring out a viable
financial model that works for the conference.”

Meanwhile, ESPN is going
after those conferences, promising a wealth of distribution on its platforms.
When it comes to the midmajors, ESPNU General Manager Burke Magnus finds that
the power of ESPN and ESPN2 help him pitch a weekly schedule on ESPNU for
smaller conferences.

“It’s not all about the six
power conferences,” Magnus said. “They’re going to get a proportional share of
the exposure, but more than any time in our company’s history with ESPNU and
360 and streaming on ESPN.com and ESPNU.com, we’re able to create a model for
conferences big and small that really works.”

Other major college
conferences are content to wait and see how the TV market takes shape. The
ACC’s TV contract ends in the spring of 2011, by which time the conference’s
commissioner expects to have a better idea about which model works and which
one doesn’t.

“We’re all interested in
watching the Big Ten Network and seeing how it evolves and seeing how
successful it is and how well-received it is by the public,” said ACC
Commissioner John Swofford.

Everybody views the Big Ten
Network’s distribution as the key. If it’s unable to gain meaningful cable
distribution, college conferences appear less likely to launch their own
channel.

“When it comes down to
having channels distributed, that’s the litmus test in terms of success or
failure, which is basically how widely is the channel distributed, at what
price and how quickly,” Thompson said.

One aspect of the Big Ten’s
deal that the ACC will be looking at, in particular, involves syndication
rights. In its new deal, the Big Ten has moved away from regional syndication,
which historically has been important to the ACC. In fact, the ACC has had a
relationship with its syndicator, Raycom Sports-Lincoln Financial Sports, for
the past 25 years.

ESPN touts its multiplatform offerings in securing
rights deals with college conferences.

“We’re not ready to let
loose of it at this point,” Swofford said. “We’ll just have to see when the
time comes. It’s been very good to the ACC up to this point and still is.”

Still, Swofford said the
conference has been looking into launching its own network, a fact that surprises
nobody.

“There’s a fiduciary
responsibility on the part of the power conferences to take a very hard look at
what the Big Ten is doing,” ESPN’s Gerber said. “The presidents demand that.
You’re going to have that going forward.”

Magnus believes conferences
also need to look at the performance of other single-entity networks, such as
the NFL Network.

“Everybody kind of accepts
on face value that this category of network is going to succeed,” he said.
“That remains to be seen, as far as I’m concerned.”

The NCAA’s Shaheen admitted
some growing pains on the part of the conference networks, but predicted that
they will grow.

“The jury will take time to
come back,” he said. “There had to be a first conference out in doing an
innovative and progressive look at this, and the Mountain West chose to be that
conference. … They’ll be rewarded in time, and that is really what you have to
examine.”